Delivering
sustainable values
Strictly innovate in streamlined direction, digitalizing production and business management is a prerequisite for PVFCCo to promote the proud tradition in the coming integration period.
4
INFORMATION ON
SHARES AND SHAREHOLDERS STRUCTURE
TOTAL NUMBER OF SHARES
391,400,000
shares
OWNED BY
15,217
shareholders
SHARES
Total number of shares of the Corporation: 391,400,000 common shares.
As end of 2021, there were 391,334,260 outstanding shares (excluding 65,740 treasury shares).
CHANGE IN OWNER’S EQUITY
In 2021, the Corporation had no change in owner’s equity.
TREASURY SHARES
As start of 2021, there were 65,740 treasury shares.
In 2021, there were no transaction during the year. As at 31 December 2021, it remained at 65,740 shares.
SHAREHOLDERS STRUCTURE
Based on the shareholder listing in the Vietnam Securities Depository, as at 28 January 2022, there was a total of 391,334,260 shares owned by 15,217 shareholders.
Shareholder structure chart
| Level | Number of Shares |
|---|---|
| Domestic shareholders | 355,531,018 |
| Foreign shareholders | 35,803,242 |
DOMESTIC SHAREHOLDERS
Detailed information on domestic shareholder structure
| Shareholders | Quantity | Number of shares | Proportion of outstanding shares |
|---|---|---|---|
| Legal entities | 102 | 272,290,461 | 69.58% |
| Individuals | 14,658 | 83,240,557 | 21.27% |
| Total | 14,760 | 355,531,018 | 90.85% |
Detailed information on major domestic shareholders
| Shareholders’ name and address | Main business lines | Number of shares held | Proportion of outstanding shares |
|---|---|---|---|
Vietnam Oil and Gas GroupAddress: 18 Lang Ha Street, Ba Dinh District, Hanoi. State-Owned Corporation Website: www.pvn.vn |
|
233,204,253 | 59.59% |
FOREIGN SHAREHOLDERS
Detailed information on foreign shareholder structure
| Shareholders | Quantity | Number of shares | Proportion of outstanding shares |
|---|---|---|---|
| Legal entities | 67 | 34,451,954 | 8.80% |
| Individuals | 390 | 1,351,288 | 0.35% |
| Total | 457 | 35,803,242 | 9.15% |
Detailed information on major foreign shareholders: None
State-Owned Shareholder: Vietnam Oil and Gas Group (as above)
BOARD OF DIRECTORS REPORT
BOARD OF DIRECTORS (BOD)
The Board of Directors (BOD) for 2021 was elected by the General Meeting of Shareholders (GMS) with 5 members as clearly indicated above. There were no Sub-committees established. The activities within BOD’s authority were specifically assigned to full-time members in charge of each field for inspection and verification so that the BOD could make decisions while supervising, directing, and urging the Corporation to implement the provided resolutions and decisions depending on assigned fields.
ACTIVITIES OF THE BOD IN 2021
As the highest management body, the BOD represents the interests of shareholders. In 2021, the current BOD had 05 incumbent members (01 independent member) who actively and strictly fulfilled their roles and responsibilities in compliance with good corporate governance standards. The BOD conducts organized full-time activities, makes collective decisions, and assigns tasks to its members based on their respective fields of expertise.
In 2021, the BOD held 6 periodical meetings, in which they solicited written opinions from their members 85 times. Resulting from these requests, 62 resolutions, key decisions and many directional documents on critical matters were approved as follows:
Strategic plan
- Approved and monitored the implementation of the 2022 production and business plan;
- The BOD developed and reviewed the Corporation development strategy.
Organization - human resources
- Leadership positions (Chairman and member of the Board of Directors, Vice President) were consolidated;
- Continued to oversee of the reorganization of the parent company’s and subsidiaries’ management system, as well as the overall restructuring.
- The number of employees was approved.
Corporate governance,
risk management and
internal audit
Approved and implemented the internal audit plan in accordance with the processes and systems completed as part of the project supporting the establishment of the internal audit processes; Directed the implementation of digital transformation;
Investment and implementation of projects
Directed the implementation and handling of issues related to the completion of the final phase of the NH3 Revamp - Phu My NPK Complex.
Issued and amended regulations
Submitted to the General Meeting of Shareholders the Corporation charter, Regulation on internal governance, Operational regulation of the BOD and BOS, issued the Regulation on management of representatives at organizations, Regulation on management of construction investment, procurement and bidding, Regulation on investment portfolio management, Regulation on Science and Technology, Regulation on information disclosure on the stock market...
Restructuring
The overall restructuring of the Corporation and its subsidiaries was implemented;
Investor relations
In April 2021, the Annual General Meeting of Shareholders was held successfully. The event was directed the IR team in order to actively implement online contact and information exchange activities to ensure continuous and full disclosure of information on performance to shareholders and investors.
Selection of an independent auditor
The BOD coordinated with the BOS to select an external audit firm for the financial statements audit as authorized by the General Meeting of Shareholders.
Apart from the periodic and extraordinary sessions, the BOD held regular weekly and monthly work briefings to inspect and evaluate its performance and oversee the BOM’s compliance with BOD’s resolutions and decisions in the production and business activities of the Corporation.
The members of the BOD directed, monitored and ensured the performance of the BOM, through the following activities:
- The BOD attended and chaired the BOM’s meetings to implement the resolutions and executive decisions and to prepare project proposals for submission to the BOD.
- The BOD participated in periodic briefings and provided guidance to the BOM.
- The BOD attended and directed meetings discussing matters relating to pricing, sales policies, staff policies, labor organization, and meetings on developing and assigning production and business plans for subsidiaries and associate companies, in reporting and reviewing of key missions, etc.
- The BOD monitored and reviewed the business operations through BOM’s reports and documentation to BOD.
- The BOD provided guidelines and suggestions to the BOM on key issues arising from the management of operations.
REPORT ON THE ACTIVITIES OF INDEPENDENT MEMBERS OF THE BOARD OF DIRECTORS
NON-EXECUTIVE AND INDEPENDENT MEMBERS OF THE BOD’S ACTIVITIES
Mr. Louis T Nguyen, Mr. Ta Quang Huy are 2 independent members of the BOD. They participated actively in all the official duties and assignments. They also monitored and provided guidance to BOM in discharging the operations since their participation.
Comments from the independent members of the BOD on the governance/management of PVFCCo in 2021
The Board of Directors and the Board of Management implemented their roles and duties in accordance with the laws on corporate governance, the Corporation charter and the executive decisions of the General Meeting of Shareholders and the BOD. The BOD and BOM’s members performed their duties and fully complied with the responsibilities and authorities assigned, as stipulated to protect the interests of all shareholders. The results were reflected in the production and business plans and targets that PVFCCo completed and exceeded in 2021.
In the Corporation, as did other shareholders, the State shareholders had an expectation that the value of the Corporation would increase. In addition to complying with regulations on corporate governance, administrators who are capital representatives were responsible for the management and preservation of the States capital. The Corporation relied heavily on the costs of production materials in the context of declining low-cost gas supply, and the Board of Management made every endeavor to present, propose and protect the State commitments and policies which were most beneficial to it in the field in both the short and long term. The BOD complied with corporate governance standards for listed companies, ensuring that both members and independent members of the BOD enforced their powers and responsibilities. In addition to the tasks mentioned above, in 2021, the Corporation continued to face many market fluctuations and risks from the Covid-19 outbreak, which affected both production and business activities. In that context, the BOD and the BOM carefully prepared resources and flexibly adapted to suit the context of new challenges, and closely followed the key objectives to assure stable operation of the system, as well as excellently reaching the targets with results that exceeded the expectations of shareholders and investors.
To approach and adhere to as closely as possible to the advanced corporate governance standards, the BOD will review and enhance activities by offering more orientations, strategies, and supervision while building up a strong and appropriate hierarchy to reduce its participation in executive activities. In 2021, the Corporation actively coordinated with professional consulting units to implement a restructuring program which would streamline the system while updating and perfecting the medium and long-term development strategy for the shareholders to consult and approve.
One independent member of the BOD holds responsibility for investor relations, considering that a significant portion of the ownership of the Corporation is with foreign investors. With the company’s operating outcomes being improved in 2021, investor demand for information access has skyrocketed (especially during the period of prolonged lockdown and social distancing). The independent member of the BOD has actively connected with the Management and functional divisions to continue communication to investors about the Corporation’s values and advantages, as well as the efforts of the BOM and the BOD, as well as bringing contributions and ideas from investors to the Board of Directors on guidelines, development strategies, or directions on finding strategic investors. Among other companies which have changed from being wholly state-owned enterprises, the Corporation has demonstrated solid governance foundations. Constant improvements to achieve even more efficiency is the desire of all shareholders.
Training to improve BOD’s corporate governance knowledge
At the time of their election or appointment, all members of the Board of Directors have expertise and training in Corporate Governance.
To meet job requirements, members of the BOD actively learn, train, update, and increase their understanding of corporate governance.
Implementation of the Resolutions of the General Meeting of Shareholders and mandated tasks
According to the Resolutions of the 2021 Annual General Meeting of Shareholders, the BOD approved to issue the regulations: Internal regulations on governance, Regulation on operation of BOD and assigned the BOS to issue the Regulation on operation. The BOD and the BOS have implemented and issued these regulations.
According to the Resolutions of the 2021 Annual General Meeting of Shareholders, the General Meeting of Shareholders authorizes the BOD to seek out and actively decide on the purchase of raw gas supply for the production of Phu My Fertilizer Plant under the authority of the General Meeting of Shareholders, in accordance with the needs of the Corporation’s business and production activities and directions of the competent authorities. As a first step, the BOD approved the extension of the gas purchase and sales contract for 2020 to the end of 2022 and then focused on efforts to implement gas supply contract for upcoming years.
The BOD and BOM’s members performed their duties and fully complied with the responsibilities and authorities assigned, as stipulated to protect the interests of all shareholders. The results were reflected in the production and business plans and targets that PVFCCo completed and exceeded in 2021.
BOARD OF SUPERVISORS REPORT
Income statement of PVFCCo and report on performance of the BOD and the President and CEO
The BOS appraised the Income statement of the BOD, the Income statement submitted by the President and CEO to the General Meeting of Shareholders and assessed that, in 2021, the Corporation had exceeded many production plans and targets. These statements were a true, complete and honest reflection of the real performance of the Corporation.
Corporation’s production results
Trading of imported fertilizers: Consumption in 2021 reached
244
thousand tons
achieving 87% of the plan, an increase of 36% compared to 2020
Profit before tax in 2021 reached
VND
3,799
billion
an increase of 348% compared to 2020
Phu My Urea: Consumption in 2021 reached
749
thousand tons
achieving 100% of the plan, decreasing by 9% compared to 2020
In 2021, sales output of chemicals reached
124
thousand tons
achieving 102% of the plan, a decrease of 6% compared to 2020
Profit after tax in 2021 reached
VND
3,172
billion
increasing by 352% from 2020
Phu My NPK: Consumption in 2021 reached
152
thousand tons
achieving 108% of the plan, an increase of 60% compared to 2020
Total revenue in 2021 reached
VND
13,117
billion
achieving 109% of the plan, an increase of 63% year-on-year
Implementation of investment projects
The NH3 Revamp - Phu My NPK Complex was completed and went into operation and is now in process of deploying the Final Acceptance Certificate (FAC), Final settlement of EPC contract, other relevant contracts and project capital settlements.
Regarding restructuring and completion of the governance and administration
Continued to accelerate the implementation of overall restructure of PVFCCo’s organizational and operational model, phase of 2020-2025, merged 13 functional divisions of the Parent company into 8 divisions, signed the contract of consulting and planning the Corporation’s development strategy vision to 2035.
EVALUATION OF THE CORPORATE GOVERNANCE PRACTICES WAS CONDUCTED BASED ON THE ASEAN CORPORATE GOVERNANCE SCORECARD
The Corporate Governance Scorecard for the ASEAN region is a set of questions based on corporate governance principles of Organization for Economic Co-operation and Development (OECD) and the best corporate governance practices. The Scorecard is used as a standard to evaluate the corporate governance practices of major listed companies in Malaysia, Indonesia, Singapore, Thailand, the Philippines and Vietnam.
Jointly developed by the Asian Development Bank and the ASEAN Capital Markets Forum, the program seeks to enhance the image of ASEAN publicly listed companies and their ability to attract investments as well as improve the image of capital markets towards integration into ASEAN. The evaluation criteria for corporate governance scores are based on publicly available corporate information sources such as the Annual Report, company website, shareholders’ notices, minutes and resolutions of the Annual General Meeting of Shareholders.
In November 2015, PVFCCo received “The ASEAN Corporate Governance Award” - in the Top 3 listed companies in Vietnam under the ASEAN Corporate Governance Scorecard. In addition, over the past years, the Corporation has been awarded Top 5 Public Listed Companies for best corporate governance in the large and mid-capitalized group by the Ho Chi Minh City Stock Exchange Authority, in coordination with Dragon Capital and the Vietnam Investment Review. This is an annual award to honor public listed companies who have achieved the highest management scores based on corporate management principles of domestic and regional leading experts.
In 2021, both the world economy, and the Vietnamese economy continued to face challenges resulting from the Covid-19 pandemic, which led to interruptions in the supply chain of goods and service all around the world. While the economy was affected heavily due to prolonged supply interruptions, the BOD and BOM proactively developed and applied systems to respond to potential risks and crises arising from the pandemic. Overall, the Corporation excelled in the execution of the maintenance plans, maintaining stable production and business, demonstrating flexibility in seizing opportunities for strong price recovery to enhance capacity, improve product quality, and achieved breakthrough steps in operational efficiency and market capitalization size.
With excellent performance throughout the prolonged Covid-19 pandemic, the Corporation exceeded many of its targets and duties as assigned by the General Meeting of Shareholders, maintaining the belief and trust of shareholders and partners, and continued to enhance corporate governance efficiency in order to meet corporate governance standards in the region.
INVESTOR RELATIONS REPORT
Despite the many complicated developments of the pandemic, in 2021, the Vietnamese stock market achieved sublimation when VN-Index surpassed 1,500 points, the highest point in the market and in 21 years of operation. With a strong recovery in selling prices and positive developments in supply and demand, stock prices in the fertilizer sector in general and DPM in particular achieved breakthrough growth to the highest level in history, attracting large cash flow from the market.
VN-Index surpassed
1,500
points
the highest point in the market and in 21 years of operation
The price of DPM stock on 31 December 2021
VND
50,000
increased by 179% in 2021
During 2021, Ho Chi Minh City and its neighboring provinces continued to experience prolonged periods of isolation and social distancing due to Covid-19 outbreaks which affected all aspects of social life including working conditions. PVFCCo was not an exception. All of PVFCCo’s leaders and employees promoted the spirit of overcoming difficulties, proactively and creatively adapting to volatile situations, taking advantage of favorable conditions to optimize production and business efficiency, achieving outstanding performance, and exceeding market expectations.
With income performance outpacing other companies in the same industry, as well as exceeding recent years, the price of DPM stock increased by 179% in 2021, reaching VND 50,000 on 31 December 2021, raising the capitalization level to nearly VND 20,000 billion. With this impressive growth in 2021, the stock liquidity improved sharply to about 4 million stocks/trading day, more than 10 times higher than the average of recent years, attracting great interest from domestic and foreign institutional and individual investors, and brokerage organizations.
In 2021, as part of our continued orientations on investor relationship, and under the direction and support of the Management, the IR team performed the role of information link between PVFCCo and the market. The operational areas were connected to the Corporation’s strategic targets, with the aim of continuously enhancing the quality of corporate governance; transparently disclosing information in all fields; ensuring compliance with regulations and principles of fair treatment with shareholders; aiming for stable, sustainable development and constantly increasing value to society, shareholders, partners and employees.
IR operations are detailed as follows:
Updating the latest contents and regulations on corporate governance to continue the enhancement of governance in managing and administering the business, ensuring compliance with the laws and managing risks in the system.
The targets and plans were openly exchanged by the BOD and BOS with the BOM in an open and respect-based manner and voted with high rate by the shareholders at Annual General Meeting of Shareholders.
Developing information channels to ensure the prompt and full provision of information to shareholders and investors, in a fair and accurate manner:
- The Corporation assigns personnel in charge of investor relationships who have close connection and support from leaders and functional divisions throughout the Corporation.
- Regularly exchanging information with investors (periodically and upon request): Organizing online meetings to update quarterly performance (bilingual in English - Vietnamese); In 2021, PVFCCo had quarterly meetings with the investment funds and brokerage organizations with massive participation of hundreds of domestic and foreign investors. Accordingly, the quarterly results were updated in detail to the investors and all their questions on operation in the quarter were answered.
- Ensuring compliance with the regulations on information disclosure (periodic and irregular).
- Documenting specialized publications for shareholders and investors: Annual Report, Sustainable Development Report, Investor Newsletter, The Corporation’s Introduction Slide (both in English and Vietnamese).
- Developing channels to respond to information from the market, making regular reports to the the Management on identification and assessment from the market along with matters receiving attention from Investors; assuring that information on DPM is conveyed in an accurate and timely manner while accurately reflecting the value and potential of the Corporation and ensuring the information control; avoiding taking advantage of incorrect or inaccurate information for personal gain, ensuring long-term and fair benefits in information provision for all shareholders.
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